Navigate:

Opinion Contributor

EU's emissions tax scheme kills American jobs

The tax would increase airfares and and hurt our economy, the author says. | AP Photo

By NICHOLAS E. CALIO | 11/4/12 9:10 PM EST

Washington doesn’t agree on much these days. From issues involving the election, to the federal budget and the Farm Bill, consensus remains elusive. But there’s one issue that the White House, House and Senate all agree on — the U.S. must stop an illegal European tax scheme that would increase airfares and eliminate thousands of well-paying American jobs. In September, the Senate unanimously approved a measure sponsored by Sens. John Thune (R-S.D.) and Claire McCaskill (D-Mo.) that would do just that. The Senate’s action followed a similar unanimous vote in the House last year. This rare example of bipartisanship sends a strong message to the world: The European Union’s Emissions Trading Scheme is an affront to U.S. sovereignty and should not stand.

Under the system, all international flights operating to and from the EU are subject to an emissions tax levied on the entire duration of each flight. It does not matter where the flights originate, how long they are actually in EU airspace or where the carrier is based. A flight originating in San Francisco and heading to London will spend only 9 percent of its airtime in EU airspace. but the EU believes it is entitled to levy a tax on the flight from the time it pushes off from the gate. If the airline does not comply, it will be subject to an “excess emissions penalty.”

Text Size

-

+

reset

The purported reason for this illegal tax is to benefit the environment. But none of the funds collected by the EU have to be used for environmental purposes. The ETS system is nothing more than a cash-grab by money-starved European countries. Congress has no choice but to act to prevent the illegal tax from being imposed on our carriers and passengers. Thousands of American jobs are at stake. The estimated cost of the EU ETS for U.S.-based carriers is more than $3.1 billion from now until 2020. That’s enough to support more than 39,200 airline jobs. But that could be the floor, not the ceiling. Carbon pricing is extremely volatile, and the EU could act to increase the ETS levy at any time. If carbon prices return to where they were just three years ago, the price tag could be twice as high.

Among the many troubling aspects of the ETS system is that it would siphon scarce resources from the U.S.-based airline industry, money that would otherwise be used to invest in fuel-saving technologies. Our airlines have led the world on this vital front. In 2011, U.S. airlines moved passengers and cargo twice as far on a single gallon of fuel as they did in 1978. And we’re not done yet. U.S. airlines are part of a global aviation coalition that has committed to 1.5 percent annual average fuel-efficiency improvements through 2020 and carbon neutral growth from 2020. These fuel and emissions targets, which are dependent on airlines’ ability to invest and on governments doing their part on air-traffic management and public-private partnerships for technology development and deployment, are part of the Global Sectoral Approach, a consensus framework for dealing with aviation emissions. The International Civil Aviation Organization, the United Nations’ body charged with setting standards for international aviation, has adopted much of this framework as its own — not the EU’s scheme.

The U.S. is not alone in its opposition to the EU ETS. Other major countries including Australia, Brazil and India have expressed concerns similar to ours. But the U.S. should lead this fight, not only to protect U.S. sovereignty and jobs but to help bring the EU back to the negotiating table in support or the right way forward — the Global Sectoral Approach. Congress has a unique opportunity to present a united front on behalf of American taxpayers and our national sovereignty. As soon as Congress returns for its post-election session, the House should once again pass a strong bill that rejects the scheme and send the legislation to President Obama’s desk for signature. Rejecting the EU’s ETS is the right thing to do for our economy, our sovereignty and ultimately, the environment.

Geez, the taxes apply to everyone, and Boeing's Dreamliner with new PW engines is the lowest carbon emissions plane on the market, so this will boost Boeing's sales for flights to Europe which means more American jobs.

And why would any America fly to Europe where taxes are much higher than in the US. If you chose to fly to Europe, you have chosen to be taxed.

11/5/12US employers added 171,000 jobs in October, and hiring was stronger over the previous two months than first thought. The unemployment rate inched up to 7.9 per cent from 7.8 per cent in September because the work force grew. The Labour Department's last look at hiring before Tuesday's presidential election sketched a picture of a job market that's gradually gaining momentum after nearly stalling in the spring. Since July, the economy has created an average of 173,000 jobs a month, up from 67,000 a month from April through June. . This would not give me the right answer as the victim of Sandy are still struggling to cope with the disaster and have power and no gas. It is too soon to tell on the jobs now may be after the election we would get the better figure. The media does many things wrong like putting cart before the horse I thank you Firozali A.Mulla DBA